Refer to the supply and demand graph for a public good.Line segment ad represents the amount at Q₁ by which the: A)marginal benefit of this public good is less than the marginal cost. B)total benefit of this public good is less than the total cost. C)marginal benefit of this public good is greater than the marginal cost. D)total benefit of this public good is greater than the total cost.

Question

Quizplus · Accepted Answer

Line segment AD represents the point where the marginal benefit (MB) intersects with the marginal cost (MC). Since AD is above the MC curve, it means that MB > MC. Therefore, the answer is C.

Refer to the Supply and Demand Graph for a Public